On January 1,2000,Yellow Corporation Issued 6% 25-Year Bonds at Par

On January 1,2000,Yellow corporation issued 6% 25-year bonds at par and used the $10,000,000 proceeds to finance the construction of a new plant.On January 1,2010,the company acquired the bonds on the open market for $9,500,000.Assuming that Yellow Corporation is neither bankrupt nor insolvent,the acquisition and retirement of the bonds results in which of the following:

A) The company must recognize a $500,000 gain.
B) The company can make an election to recognize a $500,000 gain or reduce the company's basis in the plant by $500,000.
C) The company must recognize a $500,000 gain and increase the company's basis in the plant by $500,000.
D) The company can amortize the $500,000 gain,recognizing income over the remaining life of the bonds.
E) None of the above.